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Farmers Workshop on Sugarcane Policy in India

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On 25th October 2007, JalaSpandana organised one day workshop on ‘Sugarcane Policy in India – Problems and Prospects’ at Urban Health Research and Training Institute, BBMP, Kodandarapuram, Bangalore. The workshop basically focused on the policy adopted by different states in India especially South India. Participants from Andhra Pradesh, Karnataka, Tamil Nadu, Kerala and Pondicherry did homework before coming to the workshop. The workshop was organised in such a way that representatives from each of these states made presentation in their state language which was simultaneously translated into other languages for the benefit of effective discussion.

Mrs. Chukki Nanjundaswamy, Working President, Karnataka Rajya Raitha Sangha inaugurated the workshop followed by introductory speech by Mr. R. Doraiswamy, Executive Director, JalaSpandana. Mr. V. Bhavaniprasad, (Andhra Pradesh) President, JalaSpandana delivered background note of the workshop and the lacunae in agriculture produce pricing policy adopted by different states. Mr. K.Vadivelu, (Tamil Nadu) Secretary, JalaSpandana  made key note address and Mr. H.N. Bhavi (Karnataka) President, Pragathi delivered vote of thanks.

Mr. V. Bhavaniprasad highlighted the formation of JalaSpandana by farmers of South India in 2003 at NIRD, Hyderabad to work on water and allied activities. He stressed that the agriculture in general and especially paddy and sugarcane are not remunerative to farmers. The minimum price offered by the government for paddy is less than the actual cost. The Government of India is not willing to adopt the recommendations given by Dr. M.S. Swaminathan committee which is appointed by GOI. The committee recommends for 50 percent net income over the cost of production. In 2004-05, the minimum price for one quintal of paddy was Rs 560 while the actual cost was Rs 578. Similarly there are differential standards adopted for different crops in different states for instance the predominant crop in North India gets better minimum price than the predominant crop like paddy in South India. For example Wheat gets minimum price of Rs 644 while the cost of production is Rs 610 per quintal. Mr. V. Bhavaniprasad drew attention on the parameters and indicators on the minimum price and cost of production and livelihoods of the farmers.

Mr. K.Vadivelu stressed the need for close interaction between government and farmers. The federation of all water users association under L.B.P is working as a liaison between farmers and government. Farmers have to fight for their rights and fight every step to get minimum facilities from the Government. He appreciated the initiative made by Late Prof. Nanjundaswamy of KRRS in addressing farmers woes including the Cauvery Dispute. He appealed Mrs. Chukki Nanjundaswamy to carry forward the initiatives of her father and bring back the farmers movement in greater momentum. Mr. Vadivelu also emphasised on the need to urge the State and Central Government to implement Dr. M.S. Swaminathan Committee’s recommendation on Agriculture pricing. Today no crop is beneficial to farmers with rocketing price of Agriculture inputs and low price for agriculture produce.

Mr. Gopalakrishna Rao, Vice President, JalaSpandana from Andhra Pradesh spoke on the pricing policy and the discrimination on the agriculture produced in North and South India. Wheat the predominant crop in North India gets better price than the paddy which is largely grown in South India. From Sugarcane, Government gets tax (direct and indirect tax) sum of Rs. 6000 per acre. The average yield of sugarcane is 35 tons per acre in Andhra Pradesh. Yet another, damage caused by the government is to hike the recovery rate of sugar from 8.5 to 9 per cent. The government should seriously work on the import and export policy, as and when there are good prices at International market, the export should be promoted. The CACP constituted by the government to look into pricing issue, it is not playing its role constructively. Further, the sugar industry is being managed by just Government Order, there is a need to draft Sugar Industry Act just like Irrigation Act. The cost of cultivation per acre of sugarcane is Rs 28000 yielding 35 tons per acre. The price for sugarcane per ton should be Rs. 1500 per ton to be remunerative. He also made a power point presentation which have figures on the number of sugar mills, area under sugarcane production in AP, price for last two years, etc,. For detailed presentation see the PPP enclosed.

Mr. S.M. Patil, Treasurer, JalaSpandana and Director, Ghataprabha WUCs federation from Karnataka made a detailed power point presentation highlighting the statistics of sugarcane production and sugar mills, problems faced by the farmers in Karnataka. In addition to sugarcane price issue, there are number of problems faced by farmers that goes unnoticed. These problems are the cheating in weighing of sugarcane conducted at the sugar mills. Despite of the staff appointed by the Government to check the discrepancies in weighing this problem continues. It is said that per acre at least 4 to 5 tons is under quoted which is huge loss. Similarly, the tractors which come to pickup the sugarcane are having hand in glove with the management and create harassment to the farmers. For detailed presentation see the PPP enclosed.

Mrs. Sunanda Jayaram, Representative of KRRS, stressed the importance of serious discussion on the sugar cane issues in State and at National level. Farmers with all the day to day hard work, has to find time to fight out the issues concerning agriculture and farmers livelihoods. Of late, there is a growing tendency among the government to build up all false reasons for not supporting the sugar cane industry. She said that the Government have set parameters on the quality of the sugar, which is just an excuse for not drawing efficient policy. Although, farmers spend more time in producing sugarcane, the sugar industries are controlling the governments. Mrs. Sunanda Jayaram also highlighted the fact that the reason for current sugar crises is the under functioning of the existing sugar industries. It is such a disgrace that the Governments do not involve farmers in preparing comprehensive policy. Only few farmers leaders are consulted just to fulfill the requirement to show that they have involved farmers also. She urged the government to take quick and positive decision on ethanol production. She also appealed to the farming community to encourage more and more women farmers participation in such workshop.

Mr. Boraiah, Secretary, KRRS said that the group of farmers in KRRS have done the cost benefit analysis of sugarcane production. The cost of cultivation per acre of sugarcane is Rs 1484 considering the land lease value, household labors, etc,. The industries are paying much less than the cost of production. At the same time from this sector government is benefiting Rs 8000 per acre through the taxes on molasses, distillery, etc. He urged the two sugar mill outfits namely South India Sugar Mills (SISMA) and Indian Sugar Mills Association (ISMA) to work on the price fixing. The sugar cane price should be not less than Rs.1500 per ton.

Mr. A. Ramaswamy, Vice President, LBP and Former President, JalaSpandana made detailed presentation on the sugarcane policy in India and compared the same with the sugar policy of Brazil. He highlighted that the government export import policy is not responding to the situation of the sugar production, domestic and international market. Earlier, sugarcane production was just seen as produce for sugar (jaggery and sugar) and distilleries, whereas today sugarcane is used for several other useful products which make the country earn lot of income as well as become self dependent. For instance, today ethanol production is taken up on big scale in Brazil. It is reported that about 45 per cent of the sugar cane produced in Brazil is used for ethanol production and the remaining 55 per cent goes for sugar production. Brazil watch the international market and adopt policy that benefit farmers of the country and sugar industry and in turn earns lot of foreign exchange. At present government is promoting usage of 5 per cent of ethanol whereas the available experiment shows that it can be taken up to 20 per cent without any change or modifications in the carburetor of the vehicles. He narrated the recent one day fasting at Erode, TN undertaken under his leadership on sugar cane policy to draw attention of the government. He urged the government to adopt such policy and make it mandatory to use 20 per cent ethanol. In Tamil Nadu, the price paid for sugarcane is much less than the cost of cultivation and he showed the poster which shows the zero returns in sugar cane production, which he calls it as Eighth wonder of the world.

Mr. Krishnamurthy, Member, JalaSpandana from Kerala appreciated the efforts of JalaSpandana in organising farmers workshop on Sugarcane and he briefed the audience the efforts made by JalaSpandana in promoting SRI method of paddy cultivation in Pallakad region of Kerala. At present, government has come out with package to promote SRI and organic farming i.e. SRI farmer will be paid Rs 3000 per acre and Organic farmer will be paid Rs 7000 per acre and Farmers adopting SRI and Organic farming will be paid Rs 10,000 per acre as an incentive.

Mr. Ishwar Daitota, Chief Editor, Times of India (Kannada) emphasised on the importance of farmers getting used to latest technologies in information communication system. Knowledge is power. If we are not up to date in the policies and law we will be taken for ride by other stakeholders. Today we are fortunate that the information communication is available in various languages particularly Kannada. The usage of computer and internet should become common among farming community. We can also use the technology to organise ourselves into vibrant groups and fight for the cause.

Mr. Ramachandra Reddy, Member, JalaSpandana from Andhra Pradesh emphasised the need to collective action of all farmers organisations to fight for the proper agriculture policy. The lack of appropriate pricing policy is a problem all over India. Consistent attempts should be made to reach the concerned authorities and Ministers to negotiate and contest for appropriate policies.

Mrs. Chukki Nanjundaswamy  drew attention on the Government’s policy declaring Sugar under Essential Commodity. As a result of this, neither the government nor the markets are able to provide profitable prices to sugarcane. This is not only the case in sugar it also extends to many agriculture produce. On the one hand agriculture sector in India is being crushed by the International policies like WTO/GATT  and on the other hand the Central and State Governments are not taking any bold initiatives to protect agriculture sector in which large population is directly dependent. She quoted the example of the steep fall in the prices of spice produces grown in Ghats including Kerala. The parameters set to grade the produce at International markets are the agenda of the influential countries and this is certainly going to effect the agriculturists in India.

Mrs. Parvathamma, Member, JalaSpandana urged the government to give adequate attention to farmers woes. On the one hand farmers suicides are rising and governments are still not come out comprehensive policy to address farmers suicides. She said government should make attempts to prevent farmers suicides than giving merely some package for those committed suicide.

Mr. R.M. Patil, former Minister and ED, BIRDS, Karnataka highlighted the problems in unorganized farming community. More so, the political interference have become integral part of any institutions be it farmers organisations or panchayat system. He also listed out some of the successful agitation in which he participated notably 1977 fasting to draw government attention to farmers problem. He highlighted the serious problem like salinisation and alkalisation and its impact on the livelihoods of the farmers in the region.

Mr. Chandrashekar Sadhunavar, Director, Malaprabha WUCs Federationand Member, JalaSpandana said today farmers have to get into understanding all issues related to agriculture. There is no point in leaving the top issues to some leaders to work on. He stressed the need to carry out study on institutional performance i.e. cooperative, private, public and public private partnership. Today farmers should not limit themselves to merely asking government to help them by giving better price over cost of cultivation but should also be aware of the whole process involved in the produce produced and the process of policy formulation.

Mr. Shivanna, Organising Secretary, Rashtriya Kisan Sangha, appreciated the efforts made by JalaSpandana to bring the representatives of several segments of KRRS and farmers organisation to one platform to discuss sugarcane issue. Farmers have to become self dependency by acquiring knowledge from all sources. Today it is important that farming activity should be supplemented with allied activities including natural resource conservation and management. There are quite good programmes and schemes announced by the government, unfortunately farmers are not aware of these schemes due to lack of communication strategy. He stressed that farmers should adopt farm ponds (Krishi Honda) and other livestock activity. Activities like writing letters to Ministers and Parliament would be one of the good strategies to lobby for farmers issues.

Mr. A.V.S. Velumayil, Secretary Peyikulam Association, Tuticorn, TN added the difficulties faced by sugarcane farmers in TN. He also narrated the systematic arrangement of water and labour management followed in their tank association which has more than 130 years good track record.

Mr. Shridhar of Rashtriya Kisan Sangha stressed the need for all farmers forums coming under one platform to air farmers issues.

Dr. Rama Subaiah (MA. Phd), training coordinator, JalaSpandana delivered vote of thanks.

Mr. S.M. Patil, Ramasamy and Alla Gopalakrishna Rao prepared power point presentation with regard to Sugarcane policy, problems and recommendations. The inputs during the discussion enabled to incorporate more points which made it comprehensive.

Sugarcane sector in Karnataka


         Sugarcane price is less than cost of production

         Improper weighing causing 5 to 6 tons loss per trip weighing 20 tons per trip despite of Government appointed staff for weighing

         Sugar factories reduce 2 to 3 tons per trip giving false reasons on the sugarcane content on Individual farmer basis.

         In overall crushing of the day sugar factories show less sugar content

         Reduce 2 quintals as wastage in cane for every trip

delay/deferred payments causing farmers enormous problems on
livelihoods (Some factories have not made payment since last year)

         Sugarcane becomes excess because of defunct factories

         Untimely cutting causes loss in weight and reduce yield for next crop

         Importing sugar effects domestic sugarcane price

         Ban on exporting sugar for 6 months lead to missed opportunity in encashing on international market.

         MOU b/n tractor owners and factories are binding on tractors to adhere to factories discretion.

Sugarcane Production

         Total area under sugarcane in 2006-07 is 4.90 (lakh ha)

         Total Sugarcane production in 2006-07 is 387 lakh MTs)

         Average sugarcane yield is 79 MT/ha

         Established factories – 55,  Existing working factories – 47, Existing but not working factories - 8

         Sugarcane crushed 251 lakh MTs, Sugar production 26.66 lakh MTs

         Sugar recovery 10.60 per cent

         Karnataka position at National level is in 4th place

By Products


         Sugar factories with distilleries is 12

         Sugar factories with ethanol manufacturing facility is 8

         Installed capacity for ethanol manufacturing is 360 KL per day

         Production of molasses is 11.00 lakh MTs

         Co-Generation of Power, No. of factories with cogen. Units is 18

         Installed power generation is 390 MW, Exportable power generation 250 MW

         Units in pipeline for cogen is 2

         Likely addition to installed capacity is 45 MW

         Likely addition to exportable surplus is 35 MW

Sugarcane Policy in Andhra Pradesh

         No. of Factories in 2006-07 – 38

         Yield per Hectare (Tons) – 75

         Sugar Production (lakh tons) – 20

         Sugar recovery (%) – 9.7

         Molasses (Per ton sugarcane) --45 kgs

         Average Yield Per Hectare (Mt) –76.8

       Sugarcane Price                             S.M.P                 Enhancement 

                                                (Per ton in Rs.)             (Per ton in Rs.)

            06 - 07                              802.50/-                   7.50/-

            07 – 08                             811.80/-                    9.30/-

Sugarcane Policy in Tamil Nadu

         Area under sugarcane is about 3.2 lakh ha

         Sugarcane production is about 320 lakh tons

         Crushing capacity about 200 lakh tons

         Established factories 40

         About 3 defunct factories

Problems in Tamil Nadu

         Payment per
ton for 9 % recovery is Rs.1025 (this is inclusive of transport and
cutting), this cutting and transport charge will be deducted out of
1025 (it ranges Rs 350 to 425 per ton).

         Delayed cutting causes lot of problems

         9th October – Sugarcane experts called meeting at Bangalore (5 states)

         In TN – 10 per cent production to all India production

         Ethanol production directly – Many countries adopted

         Book on Bio-fuel

         North India is well paid compared to South India (1300 to 1400 in NI)

         Mere publicity will not help (5 %) – Make mandate like Brazil

         Ethanol scope is sky – Situation conducive

         Price should be ex-field

         300 -350 cutting per ton – Rs. 75 transport charge

         8th wonder is returns being zero in sugar cane

         Top priority in the minds of government is consumer

         Country could have gained 10,000 crores from import

         SC should be removed from Essential commodity

         Self dependence and eco friendly fuel


  • Amend 1966 Sugarcane Control Order

         Instead of
saying sugarcane delivery at factory gate, It should be made the
responsibility of factory to cut and take the sugarcane at farmers farm
level by paying the price fixed by the government.

         Adopt Dr. M.S. Swaminathan Committee report that recommends 50 per cent net profit to farmers on agriculture produce.

         Make it
Mandatory to follow the item 3 e of 3 of 1966 Sugarcane Control Order,
which says payment must be made within 15 days after purchase, in case
delayed interest have to be paid to farmers.

         Ex field price for sugarcane i.e. at least Rs.1500/- per ton

         Bhargava Formulae arrears (additional cane price) 2004-05 onwards should be paid immediately

         Ethanol production and blending should be at least 20 per cent

         Commission on
Agricultural Costs and Pricing (CACP) not serious about sugarcane
growers, it should immediately start action on sugarcane.

Media gave due recognition to this workshop on sugarcane policy. Enclosed are some of the press clips.

Delegation met the Governor

On 24th January 2008, with the guidance of Sri. H.K. Patil, Opposition Leader Legislative Council, the delegation of farmers along with Mr. R. Doraiswamy, ED JalaSpandana met H.E Governor of Karnataka Sri. Rameshwar Thakur and made a representation on Sugarcane issue, water logging and other farmers issue. H.E. Governor of Karnataka directed Sri. Prabhu, Advisor to Governor to take immediate action. As a follow up, the team comprising Sri. Prabhu and Sri. Ramasamy, Principal Secretary to Agriculture visited Belgaum District and inspected the affected areas.

For news coverage on the workshop visit also